Tepco to pay compensation for suicide

Curtis Milhaupt, Director of the Center for Japanese Legal Studies at the Columbia Law School, discusses news that the firm has been held responsible for a suicide case.

A Japanese court on Tuesday ordered Tokyo Electric Power (Tepco), which operates the ailing Fukushima Daiichi nuclear power plant, to pay nearly half a million dollars as compensation in a lawsuit related to a woman's suicide.

It ruled Tepco responsible for the death of 58-year old Hamako Watanabe, who committed suicide after the Daiichi power plant exploded following the March 2011 earthquake and tsunami on Japan's east coast.

Watanabe became depressed after the disaster forced her and her husband to leave their home. She self-immolated in July 2011, according to local news media.

"If that accident hadn't happened, we would have lived a normal, peaceful life" Hamako's husband told reporters in June.

Photographer | Collection | Getty Images

Plaintiff Mikio Watanabe (C) and his supporters enter the Fukushima district court on August 26, 2014.

While the circumstance is tragic, analysts expressed doubts about the court's decision. Curtis Milhaupt, director of the center for Japanese Legal Studies at New York's Columbia Law School, told CNBC the decision was "a bit of a stretch."

"In the background of this case is a Japanese law called the 'nuclear damage compensation act,' which provides that the operator of a nuclear power plant, Tepco in this case, is strictly liable for nuclear damage. Nuclear damage is defined as damage resulting from radiation," he explained.

"So, the court in this case implicitly found that the victim's suicide was caused by a release of radiation in the Fukushima disaster. I think that is a very expansive view of causation… and it's certainly likely to be a very controversial ruling."

The landmark ruling may force the utility to publicly admit fault for deaths related to the nuclear disaster. Tepco apologized for the nuclear meltdown in a statement on Tuesday but didn't say if it would appeal the decision.

"The lower courts in Japan like the Fukushima district court tend to be far more liberal than the High Court and Supreme Court. But having said that, I think this ruling puts them in a bind because they are likely to lose in the court of public opinion if they do appeal this case. It's a very sympathetic victim and however strong their legal position, it's very dangerous for them to appeal," Milhaupt added.

Tuesday's ruling is the latest blow for Tepco. It's still struggling to contain contaminated water leakages following a taxpayer-funded bailout in 2012. The firm seeks to restore its financial health by restarting two nuclear reactors in northwestern Japan come September, according to a business plan unveiled in January.

Tepco is widely criticized in Japan for its perceived negligence, safety lapses in running nuclear reactors and for its response to the 2011 crisis. In June, the company rejected a request by residents of Namie, a town less than 10 kilometers from the Daiichi plant, to raise their compensation payout for mental distress.